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SB 984

Private Passenger Motor Vehicle Insurance - Use of Programs That Measure the Operation of an Insured Vehicle

2025 Regular Session Introduced by Alonzo Washington

Regulators limit how insurers use telematics data by requiring disclosure, dispute options, and prohibiting premium or policy actions based on vehicle-specific data.

Unfavorable Report by Economic Matters
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Bill Summary · SB 984

SB 984 — Private Passenger Motor Vehicle Insurance: Use of Programs That Measure the Operation of an Insured Vehicle (Telematics)

Status: Unfavorable Report by Economic Matters (introduced Jan 29, 2025)
Primary topic: regulation of insurer use of telematics / vehicle‑operation measurement programs

Main purpose

To establish consumer protections and regulatory limits on insurers’ use of telematics or other programs that collect data about the operation of insured private passenger vehicles. The bill requires disclosure, creates an appeals process for data disputes, restricts certain uses of telematics data, and directs the Maryland Insurance Administration (MIA) to adopt implementing regulations.

Key provisions

  • Adds new provisions to the Insurance Article (proposed sections include 19‑521, 27‑908, and 12‑307):
    • Definition: “Telematics” (or “program that measures the operation of an insured vehicle”) includes device/sensor and transmission/storage systems that collect vehicle speed, location, mileage, operating hours, acceleration/braking/cornering, engine diagnostics, and other approved data points.
    • Disclosure: An insurer issuing, selling, or delivering private passenger motor vehicle policies must disclose any use of such a program to applicants (at application) and policyholders (at renewal). The manner of disclosure is to be specified by MIA.
    • Appeals/correction: If an insurer implements a program that measures vehicle operation, it must provide a process by which a policyholder may correct or appeal data the policyholder believes to be erroneous.
    • Prohibitions on adverse actions:
    • Insurers may not use telematics data from a specific vehicle (wholly or partly) to establish the insurance premium for the policy that insures that vehicle.
    • Insurers may not use telematics data to cancel, refuse to renew, or refuse to underwrite a private passenger automobile policy.
    • Premium timing restriction: For policies that measure vehicle operation, insurers may not initiate a premium increase more frequently than every 6 months (except binders or temporary insurance).
    • Regulatory oversight / governance: MIA must adopt regulations limiting the types/amounts of data collectible and may require insurers that use such programs to establish governance plans. Governance may include auditing/monitoring for unfair bias or lack of actuarial justification, corrective action, and periodic reporting to MIA.

Who is affected

  • Consumers / policyholders: increased notice and a formal path to dispute telematics data; greater limits on insurers’ ability to base premiums or take adverse actions on vehicle‑specific telematics data.
  • Private passenger motor vehicle insurers and telematics vendors: new compliance obligations (disclosure, appeals process, governance, audits, reporting) and limits on underwriting practices.
  • Maryland Insurance Administration: required to promulgate implementing regulations and oversee compliance.

Fiscal and operational impact

  • MIA: expected to adopt required regulations using existing resources; no material fiscal impact anticipated.
  • Maryland Automobile Insurance Fund (MAIF): no anticipated fiscal effect (does not use telematics).
  • State general fund / premium tax revenues: not expected to be materially affected.
  • Small business: minimal expected effect (per fiscal analysis).

Procedural / timeline notes

  • Introduced late Jan 2025; recorded as receiving an Unfavorable Report from the Economic Matters committee on 2025‑03‑31 (per provided status).
  • If enacted in versions reviewed, the bill’s effective date was drafted as October 1, 2025, with MIA required to adopt regulations by July 1, 2026 (regulatory deadline varies across drafts; July 1, 2026 is in later versions).

If you want, I can:
- Produce a short one‑page explainer for consumers summarizing their new rights under the bill; or
- Draft a compliance checklist for insurers and vendors showing the operational changes required.

Compiled from official sources — confirm details with the bill’s official record.

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